Codere Online Luxembourg - Earnings Call - Q1 2025
May 16, 2025
Transcript
Operator (participant)
Thank you for standing by, and welcome to the Codere Online First Quarter 2025 Results Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, again, press star one. Thank you. I'd now like to turn the call over to Guillermo Lancha, Head of Investor Relations. You may begin.
Guillermo Lancha (Head of Investor Relations)
Thanks, Operator, and welcome everyone to Codere Online's earnings call for the first quarter of 2025. Today, you will hear from our CEO, Aviv Sher, and CFO, Oscar Iglesias. Our Executive Vice Chairman, Moshe Edree, will also join us in the Q&A section. Before turning the call over to Aviv, I'd like to remind everyone that during this call, we will be referring to a presentation we uploaded to our website earlier today, which includes non-IFRS preliminary and unaudited financial metrics such as net gaming revenue, adjusted EBITDA, and constant currency figures, for which you can find reconciliations or disclaimers in the appendix of the presentation. These non-IFRS financial measures should be considered in addition to, and not as a substitute for, our IFRS results. Please note that all growth rates discussed during this call are year on year comparisons unless noted otherwise.
Let me also remind you that our accounting information is prepared under IFRS accounting standards and that throughout this presentation, all monetary figures will be in EUR unless expressed otherwise. During this call, we will make forward-looking statements, including those related to our net gaming revenue and adjusted EBITDA outlooks, which are subject to numerous risks and uncertainties, including those discussed in our earnings press release and other documents filed with the SEC, and which could cause actual results to differ materially from those anticipated by these statements. These forward-looking statements reflect our current expectations based on our beliefs, assumptions, and information currently available to us. Although we believe these expectations are reasonable, we undertake no obligation to revise any statement to reflect changes that occur after this call.
Finally, please note that a replay and transcript of this call will be available on our website at codereonline.com, where you can also sign up for our investor email alerts. With that, I will go ahead and pass the call on to Aviv.
Aviv Sher (CEO)
Thanks, Guillermo, and thanks, everyone, for joining us today. Before we dive into first-quarter earnings, let me please provide a quick update on where we stand in regards to our NASDAQ compliance issue. First and foremost, we filed our 2023 annual report on Form 20-F on May 1st. That is, within the extended deadline granted to us by NASDAQ and thereby regain compliance with applicable listing requirements. This was formally confirmed in a letter we received yesterday from NASDAQ.
As you know, since engaging Marcum LLP as our new auditor on December 31st, 2023, we have been working on both our 2023 and 2024 audits in parallel, but in the back half of April, decided to focus most of our efforts on completing the 2023 audit to ensure that we met NASDAQ deadline for filing our 2023 annual report, which was both the source of our compliance issue and, as you would expect, our top priority. As a consequence, however, we have not yet been able to complete the work on the 2024 audit. As a result, we are not able to file our 2024 annual report by May 15th, that is, within the 15-day grace period provided.
Unlike last year, however, in which NASDAQ first issued a delinquency notice and provided us with the time to submit a plan to regain compliance, and given that we are currently under a one-year mandatory monitoring period, we understand that NASDAQ will be sending us a new delisting notice over the coming days, shortly following the receipt of the total delisting notice. We will be appealing this new delisting determination and requesting both a new hearing panel and further stay of any trading suspension. That said, and as already disclosed to the market, we expect to file our 2024 annual report by the end of May, so we would expect to regain compliance with NASDAQ listing requirements ahead of any hearing actually taking place.
In short, while we may still have a couple of noisy weeks ahead of us, given the communication we are required to make to the market, we expect to finally be putting this issue behind us soon. As always, we appreciate the patience and understanding that all of you have shown us throughout this process and look forward to getting back to business as usual. Moving now to the highlights of the first quarter of 2025, on page eight, we delivered EUR 57 million in net gaming revenue, 8% above Q1 2024. As in prior two quarters, net gaming revenue was negatively impacted by a weaker Mexican peso. In constant currency terms, net gaming revenue would have been EUR 62 million in the first quarter, 17% above the prior year period.
In terms of product mix, the contribution from our casino segment came in at 61% of our total net gaming revenue in the first quarter, due to not only the focus placed on this segment in the recent years, but also to a lower sports margin in Mexico. This growth in net gaming revenue was driven by a 13% increase in the number of average monthly active users, while the average monthly spend per active customer dropped 5% to EUR 118. In regards to customer acquisition, we had a very strong quarter with 91,000 first-time depositors, 21% above the 75,000 acquired in the prior year period and 25% higher than in Q4 2024. This increase resulted in an average CPA in the quarter of approximately EUR 200, making two consecutive quarters of moderation in our CPA level, which are back to the levels we had in 2023.
Finally, as announced last quarter, we put in place a one-year share buyback plan for up to $5 million. That was approved by our shareholder on March 3rd. Through May 15, we have repurchased around 68,000 shares for approximately $500,000 under this plan. With this, I will now turn the call over to Oscar to cover the financial highlights of the quarter.
Oscar Iglesias (CFO)
Thanks, Aviv. Turning now to the financial performance for the quarter on page 10, consolidated net gaming revenue grew by 8% to EUR 57 million. This was driven primarily by our Mexican business, where revenue grew 15% to EUR 30 million. In Spain, net gaming revenue was roughly flat versus the prior year period at EUR 22 million. Adjusted EBITDA, meanwhile, was positive EUR 1.8 million in the first quarter and included a contribution of EUR 5.5 million from our Spanish business and EUR 1.8 million from Mexico, its best performance to date. This marks our fifth consecutive quarter of positive adjusted EBITDA at the consolidated level.
Looking now at our P&L on page 11, adjusted EBITDA was in line with the first quarter of 2024, despite the EUR 4 million increase in net gaming revenue due to a higher level of marketing investment in the quarter, together with other investments made in the business and further into future growth. Turning now to the consolidated figures on page 12, the 8% increase in net gaming revenue was driven by a 13% increase in active customers, primarily in Mexico. On a constant currency basis, net gaming revenue would have grown 17% in the quarter instead of the reported 8%. As Aviv mentioned, we had a significant uptick in FTDs, which grew 21% to 91,000 in the quarter and were driven mostly by Mexico, where in recent months we've been testing a number of new customer acquisition channels.
Turning to the Spanish operating financial metrics, net gaming revenue in the first quarter was nearly flat at EUR 22 million, driven by a lower spend per active. On a positive note, we managed to increase the number of active customers by 4% versus the prior year and 7% sequentially, getting back to 52,000 average monthly actives, the level we had prior to the reintroduction of welcome bonuses in the second quarter of 2024. While adapting our promotional activity to this new competitive landscape in Spain has been challenging, we have made significant progress in regards to improving the quality of the customers we acquire, both in terms of player value and retention. In Mexico, net gaming revenue was MXN 30.5 million in the first quarter, 15% above the prior year period.
The Mexican peso devalued by more than 16% in the first quarter of 2025, resulting in a $5 million headwind to our net gaming revenue, an even higher impact than the $3 million we had in both the third and fourth quarters of 2024. On a constant currency basis, our net gaming revenue in Mexico would have grown 34%, so the underlying growth trend in this market is still very impressive. As in the fourth quarter, the sports betting margin was a bit lower than our target, this time equivalent to about one percentage point, which impacted NGR by about $1.5 million. As mentioned before, we had a significant increase in average monthly active customers to 82,000, 31% above Q1 2024 and 19% above the prior quarter, albeit with lower player values than what we had seen previously, but also with lower acquisition costs.
Going forward, we will continue to explore and optimize all sources of customer traffic and otherwise continue to believe that the opportunity to invest and grow in Mexico is still very compelling. On page 15, we are including again the evolution of the Mexican peso against the euro, which had been relatively stable throughout the first quarter, but more volatile since April on the back of trade tensions and other uncertainties. When comparing to the first quarter of 2024, the Mexican peso weakened by 6% in the first quarter of 2025. Looking ahead, the exchange rate headwind will continue but should begin to lessen after the second quarter, as we begin to lap the significant devaluation of the peso following federal elections in Mexico in mid-2024. In short, we are expecting a difficult comparison for the second quarter results, but less of an impact thereafter.
Turning to the balance sheet on page 16, as of March 31, we had EUR 42 million of total cash on the balance sheet, of which approximately EUR 37 million was available. In terms of our net working capital position, we ended the quarter with negative EUR 18 million, or around 8% of our LTM net gaming revenue, which continues to reflect the longer-term trend that we've spoken about of more restrictive trade terms with suppliers, notwithstanding that we believe that we are currently operating with a normalized level of working capital. Looking at our cash flow on page 17, in the first quarter of 2025, we generated EUR 2.2 million of available cash, partially offset by a EUR 0.9 million negative FX impact on ending cash balances due to the devaluation of both the Mexican peso and the U.S. dollar on cash we hold in both currencies.
Touching briefly on our outlook for 2025, on page 19, we are reiterating our expectation to generate net gaming revenue of between EUR 220 million and EUR 230 million and adjusted EBITDA in the range of EUR 10 million-EUR 15 million. Despite generating only EUR 1.8 million in adjusted EBITDA in the first quarter, we are confident that our operating and investment plan for the remainder of the year, including around the Club World Cup taking place from mid-June to mid-July, will allow us to meet our four-year guidance. That's all from my end. I will now hand it back over to Aviv for closing remarks.
Aviv Sher (CEO)
Thanks, Oscar. Before we move to Q&A, I want to thank the Codere Online team, as always, for their dedication and hard work in the recent months. As always, thank you to our investors, analysts, and market participants.
Oscar Iglesias (CFO)
It's okay. I can just deliver closing remarks. Am I off mute?
Aviv Sher (CEO)
Yes.
Oscar Iglesias (CFO)
Before moving to Q&A, I want to thank the Codere Online team, as always, for their dedication and hard work in recent months. As always, thank you to our investors, analysts, and market participants for your support and interest. We look forward to speaking with you again soon. With that said, we'll turn it back to the operator to open the call to Q&A.
Operator (participant)
Thank you. We will now begin the question-and-answer session. If you would like to ask a question, please press star one on your telephone keypad to raise your hand and join the queue. If you would like to withdraw your question, simply press star one again. Your first question comes from the line of Jeffrey Stantial from Stifel. Your line is open.
Jeffrey Stantial (Managing Director)
Hey, great. Good morning, guys. Thanks for taking our questions. Starting off, it looks like CAC was down 6% quarter-on-quarter, even though, as you touched on, user acquisition was up quite nicely. Aviv, could you just talk about the competitive environment a bit more? That's not really what's driving that. Just what is allowing you to continue to acquire more users at lower cost? Thanks.
Aviv Sher (CEO)
Can you hear me?
Jeffrey Stantial (Managing Director)
We can hear you.
Aviv Sher (CEO)
Okay. So basically, as you know, we are always testing new traffic sources and trying all kinds of experiments. We had some good experience on one good experiment on one of our channels, and we tested it for, let's say, one quarter, more or less. It resulted in reduced CPA and a higher amount of players. Those players eventually, in terms of spend per customer, were with a lower value. And there are always more sources like that. So we tested that, and we did not find it so compelling. Eventually, the supporting of those players to the revenue and the new revenue and our predicted future revenue from those customers was not as high as expected. It resulted a little bit of those numbers to be lower in terms of CPA and higher in terms of amount of FTDs.
Eventually, in revenue impact, the revenue impact was a little bit low. My assumption is that in the next quarter or so, we will be back to our plan with the amount of players that we are acquiring and with the values that we already know.
Oscar Iglesias (CFO)
Hi, Aviv. Can you hear us now? We got disconnected there for a few seconds. Can you hear us now?
Aviv Sher (CEO)
Yes.
Oscar Iglesias (CFO)
Okay, great. Sorry about that.
Jeffrey Stantial (Managing Director)
That's great. Just to confirm, yeah, we can hear Aviv on our end as well.
Oscar Iglesias (CFO)
Okay, perfect. Next chat.
Jeffrey Stantial (Managing Director)
That's helpful. Thank you for that. Then just turning to Spain, flattish net revenue growth in the quarter. That's obviously a bit of a deceleration quarter on quarter, both on a year on year and on a two-year stack basis. I just want to confirm, Oscar, is that mostly higher competition coming back in the market after some of the restrictions paired back off, or if there's something else driving that? Then as a corollary to that, are you hearing anything in terms of efforts to bring back some of those marketing restrictions via more formal legislation this time? Thanks.
Oscar Iglesias (CFO)
Yep. Yep. As you point out, the first quarter comparison is difficult because the reintroduction of the welcome bonus happened in April of last year. This is the last quarter where we have this difficult comparison with the prior year period. Yes, it's the impact of the new competitive landscape on the reintroduction of the welcome bonus and some other promotional strategies that now are permitted that previously were part of the prohibited activities. Yeah, I think that's the primary driver. I can say that even though the first quarter flat or slightly down, we are seeing some positive trends. We've made some changes, especially in the first quarter, focusing our promotional strategies where it needs to be focused on our higher-value customers. It's showing good results in April and in the first few days of May.
It's still a little bit too early to say with conviction, but within what is a more competitive landscape in Spain, I think increasingly we're going to find better ways to compete. To your second question, our understanding is that the government continues to pursue avenues to put the restriction back into place that were there pursuant to the original executive decree, but they yet haven't found a way of doing that. This is various legislative initiatives. One that we thought was closed back in February through a healthcare law that we thought would go through ultimately did not. Our understanding is the current government continues to work, and it really requires the cooperation with its coalition partners, its minority coalition partners, to get any legislation passed. That obviously would be upside for us.
We're not counting on it, at least not in our, let's say, short medium term. We're assuming that the current environment is the one we have to operate in. Obviously, the reintroduction of that restriction on welcome bonuses would be good for us and good for the whole sector.
Jeffrey Stantial (Managing Director)
Okay, perfect. If I could just squeeze in one more, Oscar. I think you talked about average revenue per active being down, on my math, about 5%. Some of that is going to be mix shift from Spain to Mexico, given the lower player values there. It looks like if you just evaluate each of those individually, average revenue per player was down at a market level. Can you just expand a bit further on what's driving that?
Oscar Iglesias (CFO)
Yeah, I think in Spain, it's the issues that we talked about that our existing portfolio, the spend per active, is a bit lower than obviously what it would have been before the reintroduction of the welcome bonus, as well as the lower player values, given the competitive bonusing and promotional environment that we have. The player values for new acquisitions are also lower. That is the Spain impact. In Mexico, it's a little bit what we discussed, and maybe Aviv already touched on this, but it's really, especially in the first quarter, the last month, I think of 2024 and into the first quarter of 2025, where we were testing out some new acquisition channels. Those were with lower acquisition costs, but also, at least initially, what we're seeing is lower player values.
That contributes, let's say, incrementally contributes and brings down the average spend per active in the period. We don't have enough data points to know conclusively whether what we found there, again, it's a higher or lower what we said. Customer acquisition cost is neither good nor bad. It's a function of then the strength of the customer, the average customer that you're acquiring, and the player values and the revenue that you're expecting to generate over longer terms. We're only three, four, five months in some cases in. The verdict is still out, but that's part of what you're seeing in terms of, at a consolidated level, the lower spend per active in the period.
Jeffrey Stantial (Managing Director)
That's great. Thank you both for all the color. I'll pass it on.
Operator (participant)
Your next question comes from a line of Michael Kupinski from Noble. Your line is open.
Michael Kupinski (Director of Research)
Thank you. Thanks for taking my questions. I just have a couple here. I was just wondering, in terms of your investments, it seems like you're getting still very favorable returns in Mexico. Are there market dynamics that are starting to improve in other markets to where you may step up investment spend, whether it be Argentina or wherever it might be? I just wanted to get your color on other potential markets that you might invest in.
Oscar Iglesias (CFO)
Aviv, you want to jump in?
Aviv Sher (CEO)
Yeah. So basically, we started to see good results in Colombia. I think everybody knows what happened in Colombia in the past few months with the VAT regime that they introduced. We had to stop our efforts over there. We do see some improvement in Panama in recent months. We have some expectations to mitigate some of the issues that we have in Colombia with Panama. Probably in the coming months, we will see our investment increase a little bit with Mexico in order to reach our targets. In terms of new markets or new big investment, currently, we are, let's say, staying defensive with our business plan, maybe just to mitigate a little bit with Colombia to see what's going on over there because it's hurting us a little bit.
I think going forward to next year with the World Cup, we will have a more aggressive budget to be able to capitalize on this large event and to continue and maintain our position in Mexico.
Oscar Iglesias (CFO)
Yeah. I would just add one point. Yeah, I'm just going to add one point on Spain, that even though since April of last year, the unit economics and player values have weakened directionally in that market, the unit economics are still very attractive. So the level of investment that we've made in that market, even at the higher levels this year versus last year, are in our mind still very justified in terms of a return profile that customers were acquiring. It is still a very good market. It just went from a great market to a very good market.
Michael Kupinski (Director of Research)
Gotcha. That was kind of leading into my next question. In terms of your guidance for the full year, obviously, you're anticipating some sporting events to kind of kickstart that in the back half. I was just wondering if you were looking at just the continuation, I was just wondering in terms of how you look at the segment of those numbers. Would Spain then start to kick in? Mexico can kind of continue to perform as well as it has, and then maybe you start to get a little pickup from some of these other markets to drive your full-year expectations. I just wonder if you can add some color on how geographically you expect to reach your target for the year.
Oscar Iglesias (CFO)
Yeah, Mike, I think that's fair that we're expecting a pickup from most markets. I think Colombia is still a TBD in terms of what we do there to mitigate the tax on deposits. But incrementally, Panama's performing well, and we've made some product changes. There's been some new developments there that have helped us make our product more attractive for customers in that market, and we're starting to show results. In Argentina, I think it's less a question of the top line, especially with the lifting of the capital controls, the new, whatever it was, 15%-20% stepped devaluation of the peso so it's a challenge. But we, without the sponsorships since whatever it would have been, end of March, end of April, we're no longer sponsors of the River Plate Club in Argentina.
At the EBITDA level, where it seems like we have the biggest hill to climb to meet guidance, that's a couple of million of expense that we won't have starting in the second quarter, partially starting in the second quarter, but definitely into the back half of the year. I think it's primarily given the expectations we have for Spain and Mexico, but then on the margin, both in Panama and Argentina, we're seeing support for that conviction that we have that will make the full-year guidance.
Michael Kupinski (Director of Research)
Gotcha. You got a good start to the year. Congratulations.
Oscar Iglesias (CFO)
Thanks, Mike.
Michael Kupinski (Director of Research)
That's all I have.
Aviv Sher (CEO)
Thank you.
Operator (participant)
Your next question comes from a line of Ryan Sigdahl from Craig-Hallum. Your line is open.
Ryan Sigdahl (Senior Research Analyst)
Hey, good day, guys. I want to stay on kind of the topic of new market potentially. It does not sound like in the near term, but parent company Grupo Codere just made an acquisition in Italy of an Italian land-based operator. Curious, you guys exited the Italian operations a few years ago. Curious how you think about new markets in the construct of maybe what your parent company is doing and specifically as it relates to Italy.
Aviv Sher (CEO)
Yeah.
Moshe Edree (Executive Vice Chairman)
Yeah, hi. Let me think. It's Moshe here. Hi, how are you? Yeah, look, first and foremost, I think that in regard to Italy, it's true. I mean, a few years ago, we had kind of like an experiment that was, I believe, before we went public. We tried to do something in that market, mainly based on our previous operational experience in Italy, based on the strong player value. As a non-brand in Italy, we find it quite hard and quite difficult to enter into this market. Therefore, we decided to withdraw, especially when it was not our core business and not with our own technology, and we did not have a license back then.
The reason that now the group decided that they're going for a partnership and a license, it's more about the strategy of the group and less the strategy of the online company. We are very focused, as Aviv mentioned in the previous question, we are very, very focused to keep our position in Mexico. We believe that this is our core market. We believe that we have still a lot of growth potential, and it's important that we be focused about keeping our, I would say, market share, and especially due to the fact that there's a lot of new competitors that are trying to get to the market. We better keep the position rather than to try to put some effort in other markets. In Mexico, we still benefit from some of the omnichannel activity with the group. That's good.
Aside of that, we see that as KPIs, we manage to increase the marketing spend and to keep the same ratio between the CPA and the player value. So that's a good sign of potential growth.
Ryan Sigdahl (Senior Research Analyst)
Just switching back to Spain specifically, appreciate kind of all of the moving pieces there. Are you willing to comment specifically within your guidance if you expect that market to return to revenue growth for the rest of the year?
Oscar Iglesias (CFO)
I mean, that's our objective. Yes. If you're talking about year on year growth, yes, we would be expecting to resume growth in Spain. Yes.
Aviv Sher (CEO)
The signals that we are getting from the KPIs are, I can't say back to normal, but positive enough to make us confident with the results that we will deliver.
Ryan Sigdahl (Senior Research Analyst)
Excellent. Thanks, guys. Good luck.
Oscar Iglesias (CFO)
Great. Thanks.
Operator (participant)
Your next question comes from a line of Arthur Roulac from Three Court. Your line is open.
Arthur Roulac (Partner and Co-Chief investment officer)
Hey, guys. Good morning.
Oscar Iglesias (CFO)
Hi, Art.
Arthur Roulac (Partner and Co-Chief investment officer)
A couple of questions. First would be, you mentioned some, I guess, additional investments in 1Q on the marketing front. Were those sort of one-time in nature, or is this something else that you're doing that's, I guess, ongoing?
Oscar Iglesias (CFO)
Yeah. Yeah, I think it's a little bit of a mix of, on the margin, additional investments that we've made in terms of growing the team, personnel, as well as on the platform front. There's a number of initiatives. As you know, we operate on the Codere platform in all jurisdictions other than Mexico, and things that we're doing there to increase stability, performance, but also give us more functionality on the product front, especially payments that's critical in Latin America. A little bit on that front. I think on the personnel front, the team has grown as well. We're always mindful of keeping personnel expense growth below the growth of top line of the business.
There have been some areas that we've had to invest in and some savings we see medium term from greater automation as it relates to certain aspects of our business, customer verification, and some of the other things we do. Today, given the scale and the growth of the business that we've had in the last year or two, there were some areas that we needed to reinforce. That's the type of investment. Nothing major there. It's really on the margin.
Aviv Sher (CEO)
Marginalia. I agree. Marginal. It's a marginal investment.
Arthur Roulac (Partner and Co-Chief investment officer)
From a straight marketing perspective, I think last year you guys spent, I think it was like high 80s in a EUR perspective. The first quarter was sort of run rating at 95 and change. Would we expect that number to step back down into the high 80s, especially in light of the devaluation in Mexico, meaning that, I guess, your EUR/dollar effectively is going further from a buy perspective there?
Aviv Sher (CEO)
Yeah. So you know that we are forecasting a full year, but the spend on each quarter is not divided equally. Usually, in the summer, we are lowering our marketing investment. So probably we will be more of the same of what we had last year, maybe a little bit higher. Of course, we are generating more revenues, and we have, let's call it, the constraints of our EBITDA guidance. So within those parameters, which are very small fluctuations, we should spend more or less as expected.
Arthur Roulac (Partner and Co-Chief investment officer)
Similar levels.
Aviv Sher (CEO)
Yeah, similar level. Plus, the third quarter usually is a little bit with less investment because of the summer and the lack of sporting events. So it's not a straight line going from first quarter to the fourth in terms of how to look at our marketing investment.
Arthur Roulac (Partner and Co-Chief investment officer)
Got it. Got it. I think I may have sort of missed this. I guess the River Plate sponsorship maybe is rolling off, and you said that might be a few million or, I do not know, a million cost savings in the back half of the year. Is that accurate?
Oscar Iglesias (CFO)
Correct.
Aviv Sher (CEO)
Yes.
Oscar Iglesias (CFO)
Correct.
Aviv Sher (CEO)
Yes.
Oscar Iglesias (CFO)
A few million. Yep.
Aviv Sher (CEO)
Yes.
Arthur Roulac (Partner and Co-Chief investment officer)
On another thing I may have missed, did you say that there was sort of a negative sport outcome in 1Q that was about a $1.5 million hit? Was that focused in Spain or Mexico, or was it mixed?
Oscar Iglesias (CFO)
Specifically Mexico. It was not a major. I think last quarter, it was about two percentage points of margin. It was a little bit more significant. One percentage point is within the band of a normal margin. Yes, that is equivalent to about $1,500,000 of NGR in Mexico.
Aviv Sher (CEO)
Yeah. We saw NFL. Other competitors also reported. NFL season was very favorable with a very low margin. It impacted, I can't say the whole industry, but any sports betting bookie that has some focus in the United States was impacted by NFL results during the first quarter.
Arthur Roulac (Partner and Co-Chief investment officer)
Yeah. No, it's been consistent across the group. I just have two more, and then I'll let someone else jump on. One thing I was confused about is this dynamic with regard to the share repurchase. Thank you for putting it in, and thank you for beginning to execute it. I guess the shareholders have approved a $10 million share repurchase, and the board has approved $5 million. Is there a reason sort of like that? I'm not sure that I've seen that dynamic before as to why that was put in place like that.
Oscar Iglesias (CFO)
Yeah. I mean, what we were trying to do there is the shareholder authorization is a broader authorization. What the board then decides in terms of the execution and the implementation of that broader authorization can change over time. Initially, what the board approved was an up to $5 million share buyback program. That is the one that we actually announced to the market, but it sits within the broader shareholder authorization. The board could tomorrow decide to do something different, to do more, to do less. Again, what we try to do with it is similar to the authorization of share issuance, right? The shareholders authorize something broader, and then the board has remit to execute in the best interests of all shareholders. Today, we are operating as a management team.
We have marching orders and under a $5 million buyback plan from the board of directors.
Arthur Roulac (Partner and Co-Chief investment officer)
Got it. My final question, and then I will stop. Has there been any progress in this Argentina license acquisition, or has it sort of remained sort of stymied over price of license?
Oscar Iglesias (CFO)
Yeah, more of the latter. More of the latter. We're still open to the opportunity, but nothing that's developed currently.
Arthur Roulac (Partner and Co-Chief investment officer)
Got it. Good. Thank you, guys, very much.
Oscar Iglesias (CFO)
Thanks, Art. Talk soon.
Operator (participant)
There are no further questions at this time. Guillermo, I turn the call back over to you.
Guillermo Lancha (Head of Investor Relations)
Okay. We have no questions coming in through the webcast either. Unless anybody else would like to ask a question, I guess we can leave it here. We will be speaking again towards the end of July with our Q2 earnings. Anyone, feel free to reach out if you have any follow-ups. Thank you.
Operator (participant)
This concludes today's conference call. Thank you for your participation. You may now disconnect.